WOW... That's a shady move!!!
On the Record Date there were 235,460,470 shares of the Company’s common stock outstanding, 122,190 shares of the Company’s Series E Convertible Preferred Stock (the “Series E”) outstanding, and 100 shares of the Series A Preferred Stock (the “Series A”) outstanding.
Each share of the Company’s common stock represents one vote. Subject to a total 9.99% ownership limitation, the holders of the Series E are entitled to vote the number of pro-rata votes per share as were equal to the number of shares of common stock into which their Series E were convertible on the Record Date. The Series A entitles the Series A Holder a total voting power equal to one vote more than the total combined voting power of the common stock and all other series or classes of equity of the Company as of the Record Date."
Therefore, a special meeting of the shareholders to approve the Reverse Stock Split is unnecessary. The Series A Holder approved the Reverse Stock Split by voting the Series A. If shareholders had been provided an opportunity to vote at a meeting, an affirmative vote of a majority of the outstanding voting power would have been required.
On November 30, 2018, the Company’s shareholders voted against the Reverse Stock Split as set forth below:
Ratio Votes For Votes Against Abstain Broker Non-Votes
1-for-30 100,748,041 108,597,511 1,018,323 299,989
1-for-400 90,814,920 118,758,399 790,555 299,990
Any ratio in between 1-for-30 and 1-for-400 92,069,181 117,971,917 322,777 299,989
Accordingly, the Company’s Board, using authority contained in the Articles, created the Series A. The Series A is not convertible and does not have any preferential dividend or liquidation rights. Holders of the Series A shall only be entitled to vote on the approval of an amendment to the Company’s Articles increasing the authorized common stock and/or effectuating a reverse split of the Company’s common stock and shall be entitled to a voting power equal to one vote more than the total combined voting power of the Company’s common stock and all other series or classes of the Company’s outstanding equity. The Company shall have the obligation to redeem all of the Series A for a total of $100 upon the Company’s filing with the Nevada Secretary of State of an amendment to the Company’s Articles effecting a reverse stock split or an increase in authorized capital of the Company’s common stock. On December 21, 2018, the Company sold all 100 authorized shares of the Series A to the Company’s Chief Executive Officer for $10.
Penny Land is a wack-a-mole game
